AN ACT to amend the Code of West Virginia, 1931, as amended, by
adding thereto a new section, designated §11-13A-6a, relating
to reallocating and dedicating five percent of coal severance
tax revenues up to $20 million annually to the coal-producing
counties of origin to be phased in over a five-year period
after accounting for the revenues dedicated to other funds;
establishing state and local coal county reallocated severance
tax funds and providing for distribution of the moneys to the
county commissions by the State Treasurer; establishing
amounts each coal-producing county to receive; requiring the
creation of local funds into which moneys to be deposited;
requiring moneys be expended solely for economic development
projects and infrastructure projects; providing definitions;
providing restrictions on the expenditure of moneys; providing
duties of State Tax Commissioner; requiring report of
expenditures to Joint Committee on Government and Finance;
providing audits of distributed funds when authorized by the
Joint Committee on Government and Finance; and authorizing
legislative and emergency rules.

Be it enacted by the Legislature of West Virginia:

That the Code of West Virginia, 1931, as amended, be amended
by adding thereto a new section, designated §11-13A-6a, to read as
follows:

ARTICLE 13A. SEVERANCE AND BUSINESS PRIVILEGE TAX ACT.

§11-13A-6a. Reallocation and dedication of percentage of
severance tax for benefit of coal-producing
counties; phase-in period; permissible uses of
distributed revenues; duties of State Treasurer
and State Tax Commissioner; audits; rulemaking.

(a) The purpose of this section is to provide for the
reallocation and dedication of a portion of the tax attributable to
the severance of coal imposed by section three of this article for
the use and benefit of the various counties of this state in which
the coal upon which that tax is imposed was located at the time it
was severed from the ground. Those counties are referred to in
this section as the coal-producing counties or, in the singular, as
a coal-producing county.

(b)(1) Effective July 1, 2012, one percent of the tax
attributable to the severance of coal imposed by section three of
this article is dedicated and shall be distributed for the use and
benefit of the coal-producing counties as provided in this section.
Effective July 1, 2013, two percent of the tax attributable to the
severance of coal imposed by section three of this article is
dedicated and shall be distributed for the use and benefit of the
coal-producing counties as provided in this section. Effective
July 1, 2014, three percent of the tax attributable to the
severance of coal imposed by section three of this article is
dedicated and shall be distributed for the use and benefit of the
coal-producing counties as provided in this section. Effective
July 1, 2015, four percent of the tax attributable to the severance
of coal imposed by section three of this article is dedicated and
shall be distributed for the use and benefit of the coal-producing
counties as provided in this section. Effective July 1, 2016, and
thereafter, five percent of the tax attributable to the severance
of coal imposed by section three of this article is dedicated and
shall be distributed for the use and benefit of the coal-producing
counties as provided in this section.

(2) In no fiscal year may the proceeds dedicated in
subdivision (1) of this subsection exceed the sum of $20 million.

(3) For purposes of this subsection, the tax attributable to
the severance of coal imposed by section three of this article does
not include the thirty-five one hundredths of one percent
additional severance tax on coal imposed by the state for the
benefit of counties and municipalities as provided in section six
of this article.

(c) The amounts of the tax dedicated in subsection (b) of this
section shall be deposited, from time to time, into a special fund
known as the Coal County Reallocated Severance Tax Fund, which is
hereby established in the State Treasury, as the proceeds are
received by the State Tax Commissioner.

(d) The net proceeds of the deposits made into the Coal County
Reallocated Severance Tax Fund shall be allocated among and
distributed quarterly to the coal-producing counties by the State
Treasurer in the manner specified in this section. On or before
each distribution date, the State Treasurer shall determine the
total amount of moneys that will be available for distribution to
the respective counties entitled to the moneys on that distribution
date. The amount to which a coal-producing county is entitled from
the Coal County Reallocated Severance Tax Fund shall be determined
in accordance with subsection (e) of this section. After
determining as set forth in subsection (e) of this section the
amount each coal-producing county is entitled to receive from the
fund, a warrant of the State Auditor for the sum due to each coal-producing county shall be issued and a check drawn thereon making
payment of that amount shall thereafter be distributed to each such
coal-producing county by hand, mail commercial delivery or
electronic transmission.

(e) The amount to which a coal-producing county is entitled
from the Coal County Reallocated Severance Tax Fund shall be
determined by:

(1) Dividing the total amount of moneys in the fund then
available for distribution by the total number of tons of coal
mined in this state during the preceding quarter; and

(2) Multiplying the quotient thus obtained by the number of
tons of coal removed from the ground in the county during the
preceding quarter.

(f)(1) No distribution made to a county under this section may
be deposited into the county’s general revenue fund. The county
commission of each county receiving a distribution under this
section shall establish a special account to be known as the “(Name
of County) Coal County Reallocated Severance Tax Fund” into which
all distributions made to that county under this section shall be
deposited.

(2) Moneys in the county’s coal county reallocated severance
tax fund shall be expended by the county commission solely for
economic development projects and infrastructure projects.

(3) For purposes of this section:

(A) “Economic development project” means a project in the
state which is likely to foster economic growth and development in
the area in which the project is developed for commercial,
industrial, community improvement or preservation or other proper
purposes.

(B) “Infrastructure project” means a project in the state
which is likely to foster infrastructure improvements including,
but not limited to, post-mining land use, any water or wastewater
facilities or any part thereof, storm water systems, steam, gas,
telephone and telecommunications, broadband development, electric
lines and installations, roads, bridges, railroad spurs, drainage
and flood control facilities, industrial park development or
buildings that promote job creation and retention.

(4) A county commission may not expend any of the funds
available in its coal county reallocated severance tax fund for
personal services, for the costs of issuing bonds, or for the
payment of bond debt service, and shall direct the total funds
available in its coal county reallocated severance tax fund to
project development, which may include the costs of architectural
and engineering plans, site assessments, site remediation,
specifications and surveys, and any other expenses necessary or
incidental to determining the feasibility or practicability of any
economic development project or infrastructure project.

(g) On or before December 31, 2013, and December 1 of each
year thereafter, the county commission of each county receiving a
distribution of funds under this section shall deliver to the Joint
Committee on Government and Finance a written report setting forth
the specific projects for which those funds were expended during
the next preceding fiscal year, a detailed account of those
expenditures, and a showing that the expenditures were made for the
purposes required by this section.

(h) An audit of any funds distributed under this section may
be authorized at any time by the Joint Committee on Government and
Finance to be conducted by the Legislative Auditor at no cost to
the county commission or county commissions audited.

(i) The State Tax Commissioner shall propose for promulgation
legislative rules pursuant to article three, chapter twenty-nine-a
of this code for the administration of the provisions of this
section, and is authorized to promulgate emergency rules for those
purposes pursuant to that article.